Mumbai: India needs to strengthen its manufacturing base, attract greater foreign investment and prepare its workforce for an artificial intelligence-driven future if it is to achieve the goal of becoming a developed nation by 2047, Chief Economic Adviser (CEA) V. Anantha Nageswaran said on Thursday.
Addressing the 13th SBI Banking & Economics Conclave 2026 here, Nageswaran said India’s development journey is taking place amid growing geopolitical tensions, the weaponisation of supply chains, climate-related uncertainties and increasing competition from China’s manufacturing sector.
He stressed that both the public and private sectors would need to rethink existing approaches and adapt to a rapidly changing global economic landscape.
According to him, building resilience while sustaining high economic growth will be crucial for India’s long-term development ambitions.
Highlighting the importance of manufacturing, the CEA said the sector would play a key role in diversifying India’s growth drivers and enhancing the country’s economic resilience and security. He noted that India cannot afford to choose between manufacturing and services, asserting that both sectors must expand simultaneously to support sustainable growth.
Nageswaran pointed out that India’s goods trade deficit, excluding oil and gold, remains at around 3.5-4 per cent of GDP, underlining the need to deepen domestic manufacturing capabilities. At the same time, he cautioned that efforts to promote indigenisation should not be limited to import substitution and must be accompanied by a focus on export competitiveness.
The CEA said India faces intense competition from advanced economies in attracting global capital and must strengthen policy frameworks at both the national and state levels. Measures such as greater tax certainty, a simpler regulatory environment, stronger investor protection and access to skilled talent would be critical in drawing foreign investment, he added.
He also advocated the creation of strategic buffers in critical commodities and the development of domestic capabilities in smaller but essential components that could become bottlenecks in global supply chains during periods of disruption.
According to Nageswaran, resilience cannot be built solely through large-scale industrial capacity. Policymakers and businesses must identify vulnerabilities across supply chains and prepare for potential shocks to ensure continuity and stability.
(IANS)
